HomeMy WebLinkAbout2010-12-20 - Finance-Accounting Committee Meeting Agenda Packet
Yorba Linda
Water District
AGENDA
YORBA LINDA WATER DISTRICT
FINANCE-ACCOUNTING COMMITTEE MEETING
Monday, December 20, 2010, 4:00 PM
1717 E Miraloma Ave, Placentia CA 92870
COMMITTEE STAFF
Director Ric Collett, Chair Ken Vecchiarelli, General Manager
Director Robert R. Kiley Stephen Parker, Finance Director
1. PUBLIC COMMENTS
Any individual wishing to address the committee is requested to identify themselves and state the matter on
which they wish to comment. If the matter is on this agenda, the committee Chair will recognize the individual for
their comment when the item is considered. No action will be taken on matters not listed on this agenda.
Comments are limited to matters of public interest and matters within the jurisdiction of the Water District.
Comments are limited to five minutes.
2. ACTION CALENDAR
This portion of the agenda is for items where staff presentations and committee discussions are needed prior to
formal committee action.
2.1. October 2010 Budget to Actual Results
Recommendation: That the Committee review, receive and file the October 2010
Budget to Actual Results.
2.2. October 2010 Investment Report
Recommendation: That the Committee receive and file the October 2010
Investment Report.
3. DISCUSSION ITEMS
This portion of the agenda is for matters such as technical presentations, drafts of proposed policies, or similar
items for which staff is seeking the advice and counsel of the Committee members. This portion of the agenda
may also include items for information only.
3.1. Committee Activities Recap and Forward Planning Objectives (Staff Presentation)
3.2. Future Agenda Items and Staff Tasks
4. ADJOURNMENT
4.1. The next regular meeting of the Finance-Accounting Committee will be held on January
10, 2011 at 4:00 p.m.
Items Distributed to the Committee Less Than 72 Hours Prior to the Meeting
Pursuant to Government Code section 54957.5, non-exempt public records that relate to open session agenda items
and are distributed to a majority of the Committee less than seventy-two (72) hours prior to the meeting will be available
for public inspection in the lobby of the District's business office located at 1717 E. Miraloma Avenue, Placentia, CA
92870, during regular business hours. When practical, these public records will also be made available on the District's
internet website accessible at http://www.ylwd.com/.
Accommodations for the Disabled
Any person may make a request for a disability-related modification or accommodation needed for that person to be
able to participate in the public meeting by telephoning the Executive Secretary at 714-701-3020, or writing to Yorba
Linda Water District, P.O. Box 309, Yorba Linda, CA 92885-0309. Requests must specify the nature of the disability and
the type of accommodation requested. A telephone number or other contact information should be included so the
District staff may discuss appropriate arrangements. Persons requesting a disability-related accommodation should
make the request with adequate time before the meeting for the District to provide the requested accommodation.
ITEM NO. 2.1
AGENDA REPORT
Meeting Date: December 20, 2010
To: Finance-Accounting Committee
From: Ken Vecchiarelli, General
Manager
Presented By: Stephen Parker, Finance Dept: Finance
Director
Prepared By: Delia Lugo, Senior Accountant
Subject: October 2010 Budget to Actual Results
STAFF RECOMMENDATION:
That the Committee review, receive and file the October 2010 Budget to Actual Results.
DISCUSSION:
Attached are the District's budget to actual summary results for the Water Fund, Sewer Fund and a
combined statement for both funds pertaining to the reporting month of October 2010. Overall, the
District revenue is trending below expectations due to lower water consumption from cooler
temperatures and higher conservation levels. This negative trend is partially offset by lower than
expected water purchases and by other operating expenses trending below budget.
Water operating revenue is only 37.9% of annual budget, which is lower than normal for the
summer months, mostly due to the higher water conservation rates from our customers. The budget
was based on 15% conservation and through October demands are down by 23%, which is 54%
lower than budgeted. The Sewer Fund is on target with a majority of its budgeted items, with the
exception of insurance, vehicle equipment, materials and maintenance costs. The variation in these
items are mainly due to the timing of payment due dates.
Variable water costs as a percentage of budget are higher than operating revenues. This is
primarily the result of the District's operational strategy to purchase a higher percentage of import
water in the first six months of the fiscal year, to take advantage of the current import water rates
prior to Metropolitan Water District of Southern California's 7.5% rate increase, which takes effect
on January 1, 2011.
PRIOR RELEVANT BOARD ACTION(S):
On November 8, 2010 the Committee reviewed, received and filed the September 30,2010 Budget
to Actual Results.
ATTACHMENTS:
Name: Description: Type:
Water Sewer October 2010.xls October 2010 Consolidated Statement Backup Material
Water October 2010.xls October 2010 Water Statement Backup Material
Sewer October 2010.xls October 2010 Sewer Statement Backup Material
Yorba Linda Water District
Summary Financial Report
Water & Sewer Funds
For Four Months Ending October 31, 2010
Annual Actual YTD
Budget YTD through Under/(Over) % of
FY 10/11 October 31, 2010 Budget Annual Budget
Revenue (Operating):
Water Revenue (Consumption & Flat Charge) $25,672,831 $9,570,850 $16,101,981 37.28%
Sewer Revenue 1,235,402 420,782 $814,620 34.06%
Other 714,221 42_3,8_24_-------------- $290,397 59.34%
Total Operating Revenue: 27,622,454 10,415,456 17,206,998 37.71%
Expenses (Operating):
Variable Water Costs (G.W., Import & Power) 12,667,936 5,077,188 7,590,748 40.08%
Salary Related Expenses 7,624,683 2,075,488 5,549,195 29.40%
Supplies & Services 3,996,584 1,165,403 2,831,181 29.16%
Depreciation & Amortization 5,017,876 1,738,003 3,279,873 34.64%
Total Operating Expenses: 29,307,079 10,056,082 19,250,997 34.31%
Operating Income (Loss) (1,684,625) 359,374 (2,043,999) -21.33%
Revenue (Non-Operating):
Interest and Investments 156,000 90,897 65,103 58.27%
Property Taxes 1,206,000 49,937 1,156,063 4.14%
Other 126,133 363,329 (237,196) 288.05%
Total Non-Operating Revenue: 1,488,133 504,163 983,970 33.88%
Expenses (Non-Operating):
Interest on Long Term Debt (1,940,954) (643,691) (1,297,263) 33.16%
Other Expense (103,193) (39,111) (64,082) 37.90%
Total Non-Operating Expenses: (2,044,147) (682,802) (1,361,345) 33.40%
Non-Operating Income (Loss) (556,014) (178,639) (377,375)
Net Income (Loss) ($2,240,639) $180,735 ($2,421,374) -3.84%
Contributed Capital 145,860 177,321 (31,461) 118.24%
Capital - Direct Labor - (165,954) 165,954,
Yorba Linda Water District
Water Fund
For Four Months Ending October 31, 2010
FY 2011 YTD % of
Annual October Actual Under/(Over) Annual
Budget 2010 YTD Budget Budget
Revenue (Operating):
Water Revenue (Residential) $ 17,248,481 $ 1,388,441 $ 6,117,265 $ 11,131,216 35.47%
Water Revenue (Commercial & Fire Det.) 1,522,341 157,733 694,250 828,091 45.60%
Water Revenue (Landscape/Irrigation) 3,588,335 368,817 1,719,368 1,868,967 47.92%
Water Revenue (Service Charge) 3,313,674 278,298 1,039,967 2,273,707 31.38%
Other Operating Revenue 701,089 210,834 421,480 279,609 60.12%
Total Operating Revenue: 26,373,920 2,404,123 9,992,330 16,381,590 37.89%
Expenses (Operating):
Variable Water Costs (G.W., Import & Power) 12,667,236 870,817 5,076,980 7,590,256 40.08%
Salary Related Expenses 6,809,598 682,989 1,840,724 4,968,874 29.45%
Supplies & Services:
Communications 376,576 31,772 78,647 297,929 20.88%
Contractual Services 707,007 56,503 248,525 458,482 35.15%
Data Processing 109,596 3,940 12,139 97,457 11.08%
Dues & Memberships 30,778 17,298 18,822 11,956 61.15%
Fees & Permits 44,020 4,019 33,552 10,468 76.22%
Board Election 72,800 - - 72,800 0.00%
Insurance 314,314 - 162,536 151,778 51.71%
Materials 337,766 25,039 139,525 198,241 41.31%
District Activities, Emp Recognition 11,648 2,186 2,823 8,825 24.24%
Maintenance 325,227 10,197 28,080 297,147 8.63%
Non-Capital Equipment 92,611 3,198 17,748 74,863 19.16%
Office Expense 39,221 531 5,715 33,506 14.57%
Professional Services 638,224 40,698 155,327 482,897 24.34%
Training 45,735 3,414 7,710 38,025 16.86%
Travel & Conferences 40,602 1,274 4,077 36,525 10.04%
Uncollectible Accounts 45,955 - 5,612 40,343 12.21%
Utilities 111,930 4,135 40,499 71,431 36.18%
Vehicle Equipment 285,877 19,418 69,271 216,606 24.23%
Supplies & Services Sub-Total 3,629,887 223,622 1,030,608 2,599,279 28.39%
Depreciation & Amortization 4,403,257 387,336 1,537,879 2,865,378 34.93%
Total Operating Expenses 27,509,978 2,164,764 9,486,191 18,023,787 34.48%
Operating Income (Loss) (1,136,058) 239,359 506,139 (1,642,197) -44.55%
Revenue (Non-Operating):
Interest 142,000 20,696 83,238 58,762 58.62%
Property Taxes 1,206,000 4,023 49,937 1,156,063 4.14%
Other Non-Operating Revenue 100,687 48,822 340,329, (239,642) 338.01%
Total Non-Operating Revenue: 1,448,687 73,541 473,504 975,183 32.69%
Expenses (Non-Operating):
Interest on Long Term Debt (1,940,954) (158,855) (643,691) (1,297,263) 33.16%
Other Expense (102,193) (17,675) (32,551) (69,642) 31.85%
Total Non-Operating Expenses: (2,043,147) (176,530) (676,242) (1,366,905) 33.10%
Non-Operating Income (Loss) (594,460) (102,989) (202,738) (391,722) 34.10%
Total Income (Loss) $ (197309518) $ 1369370 $ 3039401 (2,033,919) -17.53%
Contributed Capital $ 92,807 $ 3,186 $ 1181531 $ (25,724) 127.72%
,Capital - Direct Labor $ 55,658 $ 164,689 $ 164,689 1 .1
Yorba Linda Water District
Sewer Fund
For Four Months Ending October 31, 2010
FY 2011 YTD % of
Annual October Actual Underi(Over) Annual
Budget FY 2010 YTD Budget Budget
Revenue (Operating):
Sewer Charge Revenue $ 1,132,574 $ 99,630 $ 419,915 $ 712,659 37.08%
Locke Ranch Assessments 102,828 263 867 101,961 0.84%
Other Operating Revenue 13,132 261 2,344 10,788 17.85%
Total Operating Revenue: 1,248,534 100,154 423,126 825,408 33.89%
Expenses (Operating):
Variable Costs (Power) 700 86 208 492 29.71%
Salary Related Expenses 815,085 81,728 234,764 580,321 28.96%
Supplies & Services:
Communications 39,284 3,142 7,743 31,541 19.71%
Contractual Services 61,478 5,805 22,265 39,213 36.22%
Data Processing 10,839 390 1,201 9,638 11.08%
Dues & Memberships 3,340 1,855 2,005 1,335 60.03%
Fees & Permits 6,382 14 2,966 3,416 46.47%
Board Election 7,200 - - 7,200 0.00%
Insurance 31,086 - 16,075 15,011 51.71%
Materials 18,849 4,440 12,151 6,698 64.46%
District Activities 1,152 216 279 873 24.22%
Maintenance 41,973 2,030 24,000 17,973 57.18%
Non-Capital Equipment 20,509 427 2,444 18,065 11.92%
Office Expense 3,879 53 551 3,328 14.20%
Professional Services 67,176 5,130 17,982 49,194 26.77%
Training 5,314 326 977 4,337 18.39%
Travel & Conferences 4,348 126 395 3,953 9.08%
Uncollectible Accounts 4,545 - 555 3,990 12.21%
Utilities 11,070 409 3,987 7,083 36.02%
Vehicle Equipment 28,273 1,111 19,219 9,054 67.98%
Supplies & Services Sub-Total 366,697 25,474 134,795 231,902 36.76%
Depreciation &Amortization 614,619 50,341 200,124 414,495 32.56%
Total Operating Expenses 1,797,101 157,629 569,891 1,227,210 31.71%
Operating Income (Loss) (548,567) (57,475) (146,765) (401,802) 26.75%
Revenue (Non-Operating):
Interest 14,000 1,770 7,659 6,341 54.71%
Other Non-Operating Revenue 25,446 13,972 23,000 2,446 90.39%
Total Non-Operating Revenue: 39,446 15,742 30,659 8,787 77.72%
Expenses (Non-Operating):
Other Expense (1,000) (6,560) 5,560 656.00%
Total Non-Operating Expenses: (1,000) - (6,560) 5,560 656.00%
Non-Operating Income (Loss) 38,446 15,742 24,099 14,347 62.68%
Total Income (Loss) $ (510,121) $ (41,733) $ (122,666) $ (387,455) 24.05%
Contributed Capital $53,053 1,673 58,790 ($5,737) 110.81%
Capital - Direct Labor - (166) (1,265) $1,265 0.00%
ITEM NO. 2.1
AGENDA REPORT
Meeting Date: December 20, 2010
To: Finance-Accounting Committee
From: Ken Vecchiarelli, General
Manager
Presented By: Stephen Parker, Finance Dept: Finance
Director
Prepared By: Delia Lugo, Senior Accountant
Subject: October 2010 Investment Report
SUMMARY:
Government Code Section 53607, et, seq., requires the person delegated to invest funds to make a
quarterly report of the investments to the legislative body.
STAFF RECOMMENDATION:
That the Committee receive and file the October 2010 Investment Report.
DISCUSSION:
Staff is submitting the October 2010 Monthly Investment Report for the Committee's review and
approval. The Investment Portfolio Report presents the market value and percent yield for all the
District investments by institution. The Investment Report Summary includes budget and actual
interest and average term portfolio information as well as market value broken out by reserve
categories. An item to note is that as of October 22, 2010 the District has funded a Water Operating
Short Term account at CaITRUST. The Finance Department had set this as a goal to attain by the
end of the current fiscal year and pleased to have been able to do so at this time. The Water Capital
Projects account has increased by approximately $791,000 due to the repayment of funds from
water operating, as well as receiving a $74,329 rebate from SCE for the District's Solar Panel
project and a $70,044 insurance claim payment for JPIA for the Ohio Street pipeline repair. One
other item to note is that the Revenue Bond 2008 account balance is approximately $126,000 lower
due to the CIP payments made for projects in progress.
PRIOR RELEVANT BOARD ACTION(S):
Monthly Investment Reports are presented to the Finance-Accounting Committee on a regular
basis. Quarterly Investment Reports are presented to the Board of Directors. The Investment
Report for the month ended September 30, 2010 was received and filed by the Finance-Accounting
Committee on November 8, 2010. The Investment Report for the quarter ended September 30,
2010 was received and filed by the Board of Directors on November 10, 2010.
ATTACHMENTS:
Name: Description: Type:
Invst Rpt 10-10.xlsx Portfolio Report Backup Material
Agenda,l2-13_backup-October _2010.docx Agenda Backup Backup Material
Investment Portfolio Report
October 31, 2010
Market % Percent
Value Cost of Total Institution Yield
Cash & Checking Accounts:
$ 81,808 $ 81,808 Wells Fargo Bank
$ 81,808 $ 81,808 0.25% Total 0.00%
Money Market Accounts:
$ 906,220 $ 906,220 Wells Fargo Money Market 0.30%
$ 906,220 $ 906,220 2.81% Total 0.30%
$ 988,028 $ 988,028 3.06% Sub-total 0.30%
Money Market Account:
$ 8,813,207 $ 8,813,207 US Bank 2008 Revenue Bond 0.20%
$ 8,813,207 $ 8,813,207 27.30% 0.20%
CaITR UST
$ - $ - Heritage Money Market Fund 0.21%
$ 4,802,740 $ 4,785,096 Ca1TRUST Short Term 0.50%
$ 17,681,191 $ 17,419,105 Ca1TRUST Medium Term 1.17%
$22,483,932 $22,204,201 69.65% 1.03%
$ 32,285,167 $ 32,005,437 100% Total Investments 0.78%
Per Government Code requirements, the Investment Report is in compliance with the Yorba
Linda Water District's Investment Policy, and there are adequate funds available to meet
budgeted and actual expenditures for the next six months.
Delia Lugo, Senior Accountant
10/31/10
Investment Report Summary
Below is a chart summarizing the yields as well as terms and maturities for the month of
October 2010:
Avg. Portfolio Avg. Portfolio # of Avg. Term
Month Yield Without Yield With Days to of Portfolio
of 2010 CaITRUST CaITRUST Maturity in Days
October 0.21% 0.78% 358 259
Below is a chart comparing operating fund interest for current and prior fiscal years.
Actual Interest 10/31/09 10/31/10
Monthly - October $22,271 $22,466
Year-to-Date $78,725 $90,897
Budget 2009/2010 2010/2011
Interest Budget, October YTD $42,633 $52,000
Interest Budget, Annual $127,900 $156,000
Interest earned on investments is recorded in the Fund that owns the investment.
Investment Summary Comparison
The distribution of investments in the portfolio both in dollars and as a percentage of the total
portfolio by funds is as follows:
Fund Description Balance 10/31/10
Water Operating $ 200,835 0.61%
Water Emergency Reserve 2,070,738 6.30%
Water Capital Project Reserve 19,606,411 59.68%
Water Reserve for Debt Service 223,287 0.68%
COP Revenue Bond 2008 - Reserve 2,147,096 6.54%
COP Revenue Bond 2008 6,666,111 20.29%
Sewer Operating 414,181 1.26%
Sewer Emergency Reserve 1,007,059 3.07%
Sewer Capital Project Reserve 514,467 1.57%
$32,850,185 100.00%
Wells Fargo Bank Checking
Water Operating (561,316)
Sewer Operating 3( ,702)
56( 5,018)
Total 32.285.167
ITEM NO. 3.1
AGENDA REPORT
Meeting Date: December 20, 2010 Budgeted: N/A
To: Finance-Accounting Committee
Funding Source: N/A
From: Ken Vecchiarelli, General
Manager
Presented By: Ken Vecchiarelli, General Dept: Finance
Manager
Reviewed by Legal: N/A
Prepared By: Stephen Parker, Finance Director CEQA Compliance: N/A
Subject: Committee Activities Recap and Forward Planning Objectives (Staff Presentation)
SUMMARY:
In reviewing the agendas and minutes from the past eleven months, a number of items were discussed
by the Finance-Accounting Committee beyond the normal monthly budget to actual and investment
reports. In addition, staff has proposed potential items for the Committee to review during the 2011
calendar year.
DISCUSSION:
The following items were discussed in 2010 by the Finance-Accounting Committee:
. Retirement alternatives
. Inventory surplussed in compliance with restrictive lead regulation
. CaITRUST investment alternative
. Consolidation of funds (ID 1 & ID 2)
. FY 2010/11 budget
. Import water pass through rate increase
. Financial reserves policy
. Required communication from auditors (SAS 114)
. Debt service ratio calculation
. 2010 audit
In addition, staff proposes including the following items for the 2011 calendar year:
. Mid-year budget review and adjustments
. Cost of service and water rate study
. 5-Year financial plan
. Revision of the Purchasing Policy
. Revision of the Investment Policy
. Revision of the Financial Reserves Policy
. FY 2011/12 budget